(1 of )Jonathan Leemon, left, exhales vapor from an electronic cigarette as Kevin Acuff is helped by Seth Dundore in the Digital Ciggz store in Santa Rosa, on Thursday, January 31, 2013.
(Christopher Chung/ The Press Democrat)

Santa Rosa company takes the smoke out of smoking

CATHY BUSSEWITZ

THE PRESS DEMOCRAT | February 1, 2013

Jonathan Leemon stood before a glass case filled with hundreds of brightly-colored, miniature bottles of liquid nicotine solution. French vanilla, Belgian coco, and strawberry beckoned, just a sampling of the 120 flavors available to be "vaped" with the electronic cigarettes for sale.

The 24-year-old Santa Rosa man had been smoking up to two packs a day of traditional menthol cigarettes for eight years. But five months ago he decided to try an electronic cigarette, and he's barely puffed on its tobacco counterpart since.

Leemon's favorite flavor is called "sub-zero," because it has the minty feel of the menthols he used to smoke.

Leemon was one of a steady stream of customers on a recent weekday afternoon at DigitalCiggz, a Santa Rosa store that sells a variety of electronic cigarettes. Owner Michael Mullins and his staff could barely keep up with the steady stream of customers coming through the door, some for refills of the nicotine solution and others who wanted to try electronic cigarettes, which convert nicotine-infused liquid into an inhaleable vapor.

Mullins opened his Santa Rosa store a year and a half ago, and launched a second store in San Rafael in November. Because of the strong demand, he plans to move the Santa Rosa store to a larger location nearby with nearly four times the retail space, he said.

"There really hasn't been a product like this to come on the market before, and really give the customer the sensation that they're smoking," Mullins said. "I think that in the electronic cigarette industry you'll see more and more brick-and-mortar stores."

The e-cigarette industry has been growing at triple-digit rates, reaching an estimated $250 million in 2011 and an anticipated $500 million in 2012, according to a report by UBS Investment Research.

The possibility of reduced risk of health problems, significant cost savings, and just smelling better are some of the reasons smokers are switching to electronic cigarettes.

"Over the last year-and-a-half there have been leaps and bounds in the technology of electronic cigarettes," Mullins said. "One of the best things is that it doesn't even look like a cigarette."

The earliest electronic cigarettes, sold in convenience stores, looked very much like their traditional counterparts. But newer models can be as thick as cigars or, in the case of the "MVP" model made by "iTaste," about as large as a pack of Virginia Slims, and equipped with a USB port that can be used to charge an iPhone.

Each e-cigarette contains a rechargeable battery pack, a cartridge where the flavored liquid is added, and a built-in atomizer that turns the nicotine solution into vapor that can be inhaled.

At his wife's urging, Mullins tried his first electronic cigarette about four years ago and didn't like it. As the models improved, he found one that he liked.

"What got me into this business is that everywhere I went, whenever I pulled out a cigarette, people were amazed," Mullins said. "They said, 'What is it?' 'Where can I get it?' and, 'Does it work?'"

He started an online retail business while holding a day job, and when that business took off, he eventually opened the physical location. The College Avenue store, with black leather couches in the entryway, is designed to be like a tobacco shop, a space where customers can relax and also learn about the technology, he said.

Many customers view electronic cigarettes as a healthier alternative than traditional smoking, but health organizations are urging caution, saying too little is known about the products to ensure their safety.

"Unfortunately, there's very little known about the health impacts of electronic cigarettes, because they just kind of exploded on the market," said Serena Chen, regional advocacy director of the American Lung Association in California.

"We don't know what the health effects are, but we do know they have nicotine in them, and that nicotine is a drug," she said. "We don't want to alarm the public, but on the other hand, we want the public to know they are a product that needs to be studied."

To date, the Food and Drug Administration has not evaluated e-cigarettes for safety. The amount of nicotine or other potentially harmful chemicals inhaled during use has not been fully studied, according to the agency.

The FDA initially tried to classify e-cigarettes as a drug delivery device, and detained some early shipments of the product into the country. But after manufacturers challenged the FDA in court, it chose to classify e-cigarettes as tobacco products.

Some public health officials are concerned that the product, with its availability in malls and online, appeals to teenagers, who may become addicted to nicotine as a result.

"They're trying to capture a larger market, so they're using a lot of flavors, which might be appealing to younger people and children," said Dr. Lynn Mortensen, a family physician with Kaiser Permanente in Santa Rosa. "Because they're unregulated, and there really isn't any rigorous evidence about whether they help people with quitting tobacco, we don't recommend using them."

Mullins counters that adults also really like flavors, and he doesn't sell products to anyone under 18. California law prohibits the sale of electronic cigarettes to minors. Among those already addicted to traditional cigarettes, there's broad consensus that e-cigarettes are a healthier alternative.

"The main idea to remember is that people don't get lung cancer from nicotine," Mullins said. "People don't go to the hospital for nicotine. It's addictive ... but it's the least worrisome part of the cigarette."

Many types of e-cigarettes allow "Vapers" — the nickname for e-cigarette users — to adjust the amount of nicotine they inhale. Eventually, they could dial the nicotine levels down to zero, Mullins said.

If the FDA does step in to regulate the product, the e-cigarette industry wants to be a part of that discussion, he said.

Without definitive federal guidance, some states and cities are making up the rules about e-cigarettes as they go. Petaluma recently broadened its citywide smoking ban to include electronic cigarettes, citing a lack of definitive studies about the products' impact.

The tax revenue from electronic cigarette sales may become a consideration as municipalities decide whether or not to ban the product.

"Every quarter so far that I've been open, the state should have been able to buy a nice BMW with each of my sales tax checks," Mullins said.

The products in his store range from about $23 to $200, Mullins said. The liquid nicotine costs about $9.35 a bottle and would last a pack-a-day smoker a week and a half, he said. For Leemon, who was spending about $300 a month on cigarettes, he decided to spend a fraction of that money on electronic cigarette supplies instead. Now, his mom is buying him a higher-end model, he said.

Traditional tobacco companies are taking notice of the growing trend. Lorillard, the cigarette company that owns Newport, Maverick and other brands, bought electronic cigarette company "blu eCigs" in early 2012 for $135 million. During the third quarter that year, sales of blu eCigs contributed $14 million to Lorillard's total net sales. That company even offers pina colada and "Peach Schnapps" flavors.

"The worst case scenario is that they addict more people than were addicted before," Chen said. "And the best case scenario is that ... no one is harmed by the second-hand vapor. I think it's somewhere way in between."